Chapter 1: Why the Easy Solution to a Business Crisis - Layoffs - Is Not Necessarily the Best Solution

Key Principles

• Most companies will eventually face a business crisis that requires drastic cost reduction, possibly including layoffs. In this crisis, the main goal is to cut costs without losing your organization’s best people.

• The way layoffs are typically carried out ignores the high costs associated with losing human capital. Preserving human capital should remain a high priority for a company, even in a business crisis.

• The solution to a business crisis may involve layoffs, but only after other cost-cutting measures and alternative work arrangements have been implemented.